Stainless steel distributors have started restocking in recent weeks, but prices have remained flat amid persistently slow real demand, Fastmarkets heard during the week to Friday November 11.
Fastmarkets’ weekly price assessment for stainless steel cold-rolled sheet 2mm grade 304 transaction domestic, delivered North Europe was €3,200-3,400 ($3,312-3,519) per tonne on Friday , unchanged week on week.
Significant restocking has not been happening since around May because of bloated inventories that can be traced to the initial weeks of the war in Ukraine.
Amid the disruption to supply chains at the start of the war and the accompanying price jump, distributors built up stocks as much as possible to secure volumes and lock in prices before they climbed any further.
But demand then crashed and until recently, these high inventories and poor real demand have weighed on the market to the extent that most European stainless mills have initiated some degree of production cuts.
While end-user demand has not changed significantly, distributors have begun to restock in November, indicating that inventories have been largely cleared.
The restocking has not involved large tonnages, however, and the increased demand from distributors has not had any effect on prices.
Real demand is expected to remain at current levels until 2023, and perhaps even for the first half of the year.
It was heard, but no not confirmed, that one European mill was planning to undertake extra melting in December in preparation for a significant shutdown in March.
Published by: Ross Yeo